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Should Value Investors Buy Equitable Holdings (EQH) Stock?

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Here at Zacks, we focus on our proven ranking system, which places an emphasis on earnings estimates and estimate revisions, to find winning stocks. But we also understand that investors develop their own strategies, so we are constantly looking at the latest trends in value, growth, and momentum to find strong companies for our readers.

Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use fundamental analysis and traditional valuation metrics to find stocks that they believe are being undervalued by the market at large.

Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.

One stock to keep an eye on is Equitable Holdings (EQH - Free Report) . EQH is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock has a Forward P/E ratio of 6.12. This compares to its industry's average Forward P/E of 14.57. EQH's Forward P/E has been as high as 7.31 and as low as 4.23, with a median of 5.79, all within the past year.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. EQH has a P/S ratio of 1.14. This compares to its industry's average P/S of 1.83.

Finally, investors will want to recognize that EQH has a P/CF ratio of 7.76. This figure highlights a company's operating cash flow and can be used to find firms that are undervalued when considering their impressive cash outlook. EQH's P/CF compares to its industry's average P/CF of 15.96. Within the past 12 months, EQH's P/CF has been as high as 8.07 and as low as 3.06, with a median of 5.94.

These are only a few of the key metrics included in Equitable Holdings's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, EQH looks like an impressive value stock at the moment.


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